UNIT I

Introduction

Q1) Explain the nature and importance of HRM.

A1) Human Resource Management (HRM) is the term used to describe formal structures devised for the management of people inside an organization. The responsibilities of a human resource manager fall into three primary areas: staffing, employee compensation and benefits, and defining/designing work.

Essentially, the motive of HRM is to maximize the productiveness of an organization by optimizing the effectiveness of its employees. This mandate is unlikely to change in any fundamental way, despite the ever-increasing pace of change in the business world. As Edward L. Gubman discovered in the Journal of Business Strategy, "the basic mission of human resources will always be to acquire, develop, and retain talent; align the workforce with the business; and be an excellent contributor to the business. Those three challenges will never change."

Before we define HRM, it looks pertinent to first define the term ‘human resources’. In common parlance, human resources mean the people. However, different management experts have described human resources differently. For example, Michael J. Jucius has described human assets as “a whole consisting of inter-related, inter-dependent and interacting physiological, psychological, sociological and ethical components”.

According to Leon C. Megginson “From the national point of view human resources are knowledge, skills, creative abilities, talents, and attitudes obtained in the population; whereas from the view-point of the individual enterprise, they represent the total of the inherent abilities, acquired knowledge and skills as exemplified in the skills and aptitude of its employees”.

Sumantra Ghosal considers human resources as human capital. He classifies human capita into three categories-intellectual capitals, social capital and emotional capital. Intellectual capital consists of specialized knowledge, tacit knowledge and skills, cognitive complexity, and learning capacity.

Social capital is made up of network of relationships, sociability, and trustworthiness Emotional capital consists of self-confidence, ambition and courage, risk-bearing ability, and resilience. Now it is clear from above definitions that human assets refer to the qualitative and quantitative aspects of employees working in an organisation.

Let us now define human aid management.

In simple words, HRM is a method of making the efficient and effective use of human resources so that the set goals are achieved. Let us also consider some necessary definitions of HRM.

According to Flippo “Personnel management, or say, human resource management is the planning, organising, directing and controlling of the procurement development compensation integration, 4intenance, and separation of human sources to the end that individual, organisational and social objectives are accomplished”.

The National Institute of Personnel Management (NIPM) of India has defined human resource/personnel management as “that part of management which is concerned with humans at work and with their relationship within an enterprise. Its purpose is to deliver collectively and boost into an advantageous employer of the men and ladies who make up an organization and having regard for the well-being of the persons and of working groups, to enable them to make their best contribution to its success”.

According to Decenzo and Robbins “HRM is concerned with the humans dimension in management. Since every organisation is made up of people, acquiring their services, developing their skills, motivating them to higher levels of performance and making sure that they proceed to hold their commitment to the organisation are essential to achieving organizational objectives. This is true, regardless of the type of organisation-government, business, education, health, recreation, or social action”.

Thus, HRM can be described as a procedure of procuring, creating and keeping competent human resources in the organisation so that the goals of an organisation are completed in a positive and efficient manner. In short, HRM is an art of managing people at work in such a manner that they give their best to the employer for achieving its set goals.

Q2) What are the functions of HRM?

A2) Human resources (HR) professionals conduct a wide variety of tasks within an organizational structure. A brief review of the core functions of human resource departments will be useful in framing the more common activities a human resource professional will conduct. The core functions can be summarized as:

Staffing

This includes the activities of hiring new full-time or part-time employees, hiring contractors, and terminating employee contracts.

Staffing activities include:

Development

On-boarding new employees and providing resources for continued development is a key investment for organizations, and HR is charged with maintaining a developmental approach to existing human resources.

Development activities include:

Compensation

Salary and benefits are also within the scope of human resource management. This includes identifying appropriate compensation based on role, performance, and legal requirements.

Compensation activities include:

Safety and Health

Achieving best practices in various industries include careful considering of safety and health concerns for employees.

Safety and health activities include:

Employee and Labor Relations

Defending employee rights, coordinating with unions, and mediating disagreements between the organization and its human resources is also a core HR function.

Employee and labor relations activities include:

Q3) Write a note on development of HRM.

A3) The development of human resources management concept is as follows:

1. Industrial revolution stage: Industrial revolution brought the three major developments

Due to the industrial revolution, people specialized in their job. Workers organized themselves into trade unions to achieve better conditions of employment. Labor laws were enacted to protect the interest of worker. Collective bargaining between labor and management was used to settle industrial disputes.

Robert Owen reduced working hours and built houses and schools for workers. After industrial revolution, problems related to human resources led towards taking care of employees. It can be considered as the first stage of human resources development.

2. Scientific management movement stage: This stage aimed at improving worker efficiency through proper selection, training and compensation. F.W. Taylor suggested the following tips

Individuals who are selected for the jobs should be physically and mentally ready to demand of jobs.

Employees should not be called upon to work at the time that would be detrimental to their health.

Education and development of the workers, properly trained and developed workers produced best.

Incentive system to “earn more be performing more” properly paid workers.

Specialization through division of work to achieve efficiency.

3. Industrial psychology: An employee having positive attitude can faster industrial efficiency. Efficiency can be increased by testing intelligence test of the employee. Thus to increase the efficiency, human psychology should be studied through different test and should developed a good interest, and positive attitude on the work in them.

4. The human relation movement stage: This stage focuses people element in personnel management. Hawthorne studies serve as the beginning of human relation movement. It advocates the following personnel management aspects.

- Participative management and teamwork.

- Importance of social setting and group dynamics in employee productivity.

- Need for improved communication among managers and employees.

5. The period of labor legislation: To control, direct and motivate the labor, there should be strong need of some kinds of legislation. The civil right act was passed in 1964. Discrimination law, pension laws, health and safety laws, federal regulatory agencies and their interpretive, guidelines, and cowed ruling affected virtually every aspect of employment.

6. Organizational development movement stage: The organization development (OD) movement of the 1960s and 1970s was closely associated with the concept of behavioral science. The OD approach concentrates on overall organizational effectiveness, especially with regard to process how people behave in situation where they are constantly interacting with one another. Team development and management of change were often important features of an OD programme. Particular attention was paid to the analysis of group process and OD consultants evolved methods of analyzing organization behavior, especially within and between group, and of solving conflict problems

Q4) Write a note on contribution of Industrial Psychology in HRM.

A4) This is the application of psychology principles in a corporate organization. They take note of productivity, behavior, balance, and development at work. To help understand employees better, they give team-building tasks, coach employees and give pre-employment/behavioral pattern test.

Since HR alone cannot efficiently handle employees’ well being, this makes industrial-organizational psychology a key subject in the organization. The two go together or can be merged together as one. Their major aim is to make the workplace a desirable place for all and sundry.

What a typical company is more interested in is profit. Investors won’t invest in a firm for being too classy or popular; they invest because of returns and dividends. Every single establishment is profit driven. You must deliver quality goods and services to get quality profit and quality profit is directly dependent on high performing individuals.

Understanding human psychology is a requirement to helping employees get maximum result, stay motivated, and also achieve their goals. It is not enough to just discipline or fire employees, sit them down, counsel and question to know what happened and how they feel before taking decisions. This will help get a good result.

Industrial-organizational psychology must be seen as a better half of human management where one cannot do without the other. The aim of industrial-organizational psychology is to increase and maintain work productivity. Psychologists do not only counsel, but observe employees and sometimes, employers’ interaction and reaction to determine where the issue lies. They review company’s policies to help the employer and employee. They also learn from past issues with employees so as to make good hiring decisions.

Q5) Discuss the Scope of HRD.

A5) The scope of HIRD can be explained with reference to its various sub-systems or mechanisms: The various sub-systems are:

1. Performance Appraisal:

An HRD-oriented performance appraisal is conducted so that it helps the superiors to:

2. Promotion of Employees:

An important area of HRD relates to promotion of employees who work with commitment and dedication show improved performance. HRD plays an important role in enhancing commitment and dedication of the employees. Committed and dedicated employees are recognized and rewarded with promotion, which involves: higher pay, higher powers and higher position.

3. Training and Development:

One of the major activities of HRD is to provide training to the employees. Training and development programmes enable the Employees to:

4. Career Development:

HRD facilitates career development of the employees in the organisation. Career development refers to the continuous effort to match long-term individual needs with that of the organisation.

Career development can take place through assigning challenging tasks, counselling, promotion, training and so on Career development not only helps the employees but also the organisation to be dynamic and growth oriented.

5. Organisational Development:

This area focuses attention on assuring healthy relationships throughout the organisation. The O.D experts help individuals, groups or departments to initiate and manage change. They also help any unit or department in the company that is facing any problems such as absenteeism, internal conflicts, low productivity or resistance to change.

6. Motivation:

Rewarding employees is an important area of HRD. Proper rewards and recognition motivates the employees to put in their best efforts. It also indicates that the organisation respects and values the employees.

Rewards may be given to individual employees, teams/groups or departments. They may be in form of:

7. Employee Welfare:

HR managers recognise the need to improve employee welfare. Therefore, to develop and motivate employees, the HR managers introduce effective employee welfare measures. The welfare measures include holidays with pay, medical insurance, canteen facilities, recreation facilities, etc.

8. Quality of Work Life:

HRD programmes facilitates QWL. It is a technique for improving productivity and quality of work. It involves labour management co-operation, collective bargaining and participative management.

QWL programmes focus attention on providing good working conditions, job security, good pay and other facilities such as flexible working hours, freedom to suggest changes or improvements, etc. QWL generates a sense of belonging that benefits the organisation as well as the individual employees.

9. Human Resource Information:

Employee related information must be maintained by the company. The employee information includes:

The employee related information is utilised whenever there is a need to assign special projects to employees, to provide additional training, to facilitate promotions and transfers, etc.

10. Mentoring:

Progressive firms use mentoring programmes to train and develop the employees, especially at the executive level. Generally, a mentor is a senior person who shares knowledge and experience, and counsels the mentee to attain greater Mentoring aids in problem solving and qualitative decision making. Improved decision-making and action leads to greater performance of the organization.

Q6) Write a note on HR policies.

A6) Human resource policies are the formal rules and guidelines that businesses put in place to hire, train, assess, and reward the members of their workforce. These policies, when organized and disseminated in an easily used form, can serve to preempt many misunderstandings between employees and employers about their rights and obligations in the business place. It is tempting, as a new small business owner, to focus on the concerns of the business at hand, and put off the task of writing up a human resource policy. All business analysts and employment lawyers will advise a new business owner to get a policy down on paper, even if it is a simple one drafted from a boilerplate model. Having policies written is important so that it is clear to all what the policies are and that they are applied consistently and fairly across the organization. Moreover, when issues concerning employee rights and company policies come before federal and state courts, it is standard practice to assume that the company's human resource policies, whether written or verbal, are a part of an employment contract between the employee and the company. Without clearly written policies, the company is at a disadvantage.

Small businesses--and especially business startups--cannot afford to fritter away valuable time and resources on drawn-out policy disputes or potentially expensive lawsuits. Having a human resource policy in place from the start can help to avoid this situation. The business owner who takes the time to establish sound, comprehensive human resource policies will be far better equipped to succeed over the long run than the business owner who deals with each policy decision as it erupts. The latter ad hoc style is much more likely to produce inconsistent, uninformed, and legally questionable decisions that may cripple an otherwise prosperous business. For as many small business consultants state, human resource policies that are inconsistently applied or based on faulty or incomplete data will almost inevitably result in declines in worker morale, deterioration in employee loyalty, and increased vulnerability to legal penalties. To help ensure that personnel management policies are applied fairly, business owners and consultants alike recommend that small business enterprises produce and maintain a written record of its HR policies and of instances in which those policies came into play.

Q7) What are the subjects covered by Company HR policies?

A7) SUBJECTS COVERED BY COMPANY HR POLICIES

Small business owners should make sure that they address the following basic human resource issues when putting together their personnel policies:

Q8) What is Resource Procurement in HRM?

A8) This could mean one of two things. It could mean HRM teams that focus on finding good fits for the procurement teams mentioned above. Lots of staffing and recruitment groups focus on finding the right candidates for their clients in one industry – whether that’s creative, marketing, sales, etc. Therefore, there are lots of staffers looking to find good fits for procurement jobs like buyer, procurement assistant, supply chain analyst, contract coordinator, and many more.

In these instances, HR professionals need to really understand the roles they’re filling for, the kinds of industries looking for buyers and procurement specialists, and what kinds of things are being procured. It’s a lot of information, but it’s crucial to finding the right fits for businesses looking for procurement team members.

HR Procurement

But there is another way that HR and procurement work together, and that is with HR functioning as the procurement team. This is two-fold:

Procuring people: People are a resource – many would say a business’s most important resource (and certainly one of the most expensive). Procurement, then, for HR, is the function of their job that makes them the expert in finding and obtaining this resource. This part of HR usually falls under recruitment, with recruiters focusing their time and skills in this area.

Procuring supplies: HR is also often responsible for physically ordering office supplies that the people in the office need and use. Anything from printer paper to coffee to pens (and in many small businesses the furniture, etc.) is often taken care of by a human resource manager. Supplies might also mean the physical needs of a business-sponsored event, whether it’s tables and banners and streamers or food, drink, a guest speaker, and sound equipment.

Whether the work is finding quality people to go on and procure product for their business or it’s the added responsibility of supply ordering to the role of an HR specialist, one of the most important skills that can bring success is an attention to details. It’s important to be able to manage projects, multi-task, and effectively see details to be able to get results in HR procurement roles.

Q9) What are the steps involved in HR planning?

A9) Human resource planning is a process via which the right candidate for the right job is ensured. For conducting any process, the foremost vital task is to develop the organizational objective to be achieved via conducting the said process.

Six steps in human resource planning are-

1. Analysing Organizational Objectives:

The objective to be achieved in future in various fields such as production, marketing, finance, expansion and sales gives the idea about the work to be done in the organization.

2. Inventory of Present Human Resources:

From the up to date human aid information storage system, the current number of employees, their capacity, performance and potential can be analysed. To fill the various job requirements, the internal sources (i.e., employees from within the organization) and external sources (i.e., candidates from various placement agencies) can be estimated.

3. Forecasting Demand and Supply of Human Resource:

The human resources required at different positions according to their job profile are to be estimated. The available internal and external sources to fulfill those requirements are also measured. There be proper matching of job description and job specification of one particular work, and the profile of the man or woman should be suitable to it.

4. Estimating Manpower Gaps:

Comparison of human aid demand and human aid supply will furnish with the surplus or deficit of human resource. Deficit represents the number of people to be employed, whereas surplus represents termination. Extensive use of proper training and development programme can be performed to upgrade the skills of employees.

5. Formulating the Human Resource Action Plan:

The human resource plan depends on whether there is deficit or surplus in the organization. Accordingly, the plan may be finalized both for new Selection, training, interdepartmental transfer in case of deficit of termination, or voluntary retirement schemes and redeployment in case of surplus.

6. Monitoring, Control and Feedback:

It often involves implementation of the human resource action plan. Human assets are allocated according to the requirements, and inventories are up to date over a period. The plan is monitored strictly to identify the deficiencies and remove it. Comparison between the human resource plan and its authentic implementation is done to ensure the appropriate action and the availability of the required number of employees for various jobs.

Q10) What is job analysis?

A10) A job may be defined as a sum total of tasks, duties and responsibilities which is assigned to individual employees.

After definition of job, FIR manager needs to undertake job analysis. Job Analysis is the starting point of recruitment and selection. It is a systematic process of collecting and studying information about the various jobs in the organisation.

Edwin Flippo defines "Job analysis is the process of studying and collecting information relating to the operations and responsibilities of a specific job,"

Q11) What is job description?

A11) Job description gives details of the job in respect of job title, duties and responsibilities, location of the job, working conditions, and other relevant details describing the job. It is an overall summary of job requirements.

According to Edwin Flippo "a job description is an organised, Factual statement of duties and responsibilities of a specific job.  It should tell what is to be done, how it is done and why. It is a standard of function, in that it defines the appropriate and authorised content of a job."

The job description describes every aspect of the job. Job description once prepared is reviewed periodically and revised in the light of changing conditions.

Q12) What are the contents of Job Description?

A12)

1. Job identification:

It gives details relating to the job title, code number of the occupation, location, name of the division/department, location and the unit where the job exists. This part of job analysis helps to identify the job and to provide designation to job holder.

2. Job Summary:

It gives brief details of the job contents in terms of tasks or activities to be performed. Also, brief details are stated relating to the hazards and discomforts relating to the job.

3. Duties and Responsibilities:

It indicates the duties to be performed-what, how and why of a job. It also describes job responsibilities relating to custody of valuables and records, supervision and training of subordinates, and other responsibilities towards effective performance of the job.

4. Relationship with Other Jobs:

It indicates internal (within the organisation) relationship of the job with other jobs that are horizontal, vertical and diagonal. It also indicates external relationship such as relationship with customers, dealers, Government officials, trade associations, etc.

5. Machines and Tools:

It states the type of machines, tools and equipments that are to be used for the performing the job activities, Therefore, candidates who can handle the machines and tools properly are considered for selection.

6. Supervision:

It indicates the extent of supervision which the job is subject to from higher levels, and the extent of supervisions which the job holder has to exercise over subordinates. Designations of immediate superior and subordinates may also be stated.

7. Social Environment:

The social environment prevailing in the organisation may be stated in the job description. Such description enables to job holder to adjust with the social environment at the work place

8. Working Conditions:

The working conditions are also a part of the job description. The working conditions include:

Q13) What are the uses of Job Description?

A13) Uses of Job Description

Q14) What is Job Specification?

A14) It gives details of the candidate who is supposed to do a particular job with reference to qualities, qualifications, experience, gender, family background, etc. It is an overall written summary of employee requirements.

Job specification provides a standard of an employee for possessing the required qualities and qualities to perform the Job efficiently and effectively.

Edwin Flippo defines "job specification is a statement of the minimum acceptable human qualities necessary to perform a job properly."

Q15) What are the contents of Job Specification?

A15)

Contents of Job Specification

The elements included in job specifications differ from organisation to organisation, and from job to job. However, elements like age, gender, education, health, experience, and skills are invariably included in job specification for all types of jobs in all organisations.

Essential and Desirable Elements:

Experts broadly divide the elements of job specification in two groups:

Q16) What are the uses of Job Specification?

A16) Uses of Job Specification

Q17) What are the sources of Recruitment?

A17) The eligible and suitable candidates required for a particular job are available through various sources.

Internal Sources of Recruitment:

1. Promotions:

The promotion policy is followed as a motivational technique for the employees who work hard and show good performance. Promotion results in enhancements in pay, position, responsibility and authority. The important requirement for implementation of the promotion policy is that the terms, condi­tions, rules and regulations should be well-defined.

2. Retirements:

The retired employees may be given the extension in their service in case of non­-availability of suitable candidates for the post.

3. Former employees:

Former employees who had performed well during their tenure may be called back, and higher wages and incentives can be paid to them.

4. Transfer:

Employees may be transferred from one department to another wherever the post becomes vacant.

5. Internal advertisement:

The existing employees may be interested in taking up the vacant jobs. As they are working in the company since long time, they know about the specification and description of the vacant job. For their benefit, the advertisement within the company is circulated so that the employees will be intimated.

Benefits of Internal Sources of Recruitment:

1. The existing employees get motivated.

2. Cost is saved as there is no need to give advertisements about the vacancy.

3. It builds loyalty among employees towards the organization.

4. Training cost is saved as the employees already know about the nature of job to be performed.

5. It is a reliable and easy process.

Limitations of Internal Sources of Recruitment:

1. Young people with the knowledge of modem technology and innovative ideas do not get the chance.

2. The performance of the existing employees may not be as efficient as before.

3. It brings the morale down of employees who do not get promotion or selected.

4. It may leads to encouragement to favouritism.

5. It may not be always in the good interest of the organization.

External Sources of Recruitment:

1. Press advertisement:

A wide choice for selecting the appropriate candidate for the post is avail­able through this source. It gives publicity to the vacant posts and the details about the job in the form of job description and job specification are made available to public in general.

2. Campus interviews:

It is the best possible method for companies to select students from various educational institutions. It is easy and economical. The company officials personally visit various institutes and select students eligible for a particular post through interviews. Students get a good opportunity to prove themselves and get selected for a good job.

3. Placement agencies:

A databank of candidates is sent to organizations for their selection purpose and agencies get commission in return.

4. Employment exchange:

People register themselves with government employment exchanges with their personal details. According to the needs and request of the organization, the candidates are sent for interviews.

5. Walk in interviews:

These interviews are declared by companies on the specific day and time and conducted for selection.

6. E-recruitment:

Various sites such as jobs.com, naukri.com, and monster.com are the available electronic sites on which candidates upload their resume and seek the jobs.

7. Competitors:

By offering better terms and conditions of service, the human resource managers try to get the employees working in the competitor’s organization.

Benefits of External Sources of Recruitment:

1. New talents get the opportunity.

2. The best selection is possible as a large number of candidates apply for the job.

3. In case of unavailability of suitable candidates within the organization, it is better to select them from outside sources.

Limitations of External Sources of Recruitment:

1. Skilled and ambitious employees may switch the job more frequently.

2. It gives a sense of insecurity among the existing candidates.

3. It increases the cost as advertisement is to be given through press and training facilities to be provided for new candidates.

Q18) What is E-SELECTION? What are its advantages?

A18) The E-Selection refers to Online selection of employees. It is the process of hiring the potential candidates for the vacant job positions, i using the electronic means, mainly the internet.

Nowadays, companies use internet to reach to a large number of job seekers and hire the best talent for the company. The time and cost in e-selection is comparatively as compared to physical selection process.

E-Selection includes the process of identifying the prospective candidates, conducting tests and interviews online, and selecting the right candidates as per the job requirement.

Generally, the job vacancies are advertised on the World Wide Web www) by the potential recruiters. In response to the online recruitments ads, the potential applicants send their CVs or resume online for the consideration of the potential employers for the purpose of selection.

Methods/Techniques of E-Selection:

1. Online Applications:

Potential candidates can make job applications online with the qualifying details with reference to biological data, qualifications, experience, etc. The online application details are the candidates is then transferred on the employer's data bank in a particular format as desired by the employer.

2. Key Word Search:

It is the method of screening the applications received online with the help of software to locate key words that may be used by the candidates in the resume. For example, the key words may relate the experience of the candidate in terms of number of years, qualifications that are relevant to the job, (for marketing manager- MBA in marketing), institution where the candidate acquired the qualification (for CA- Institute of Chartered Accountants of India), graduate level work experience or volunteer level experience, topic of research, etc.

The best example of KWS is by submitting CV on LinkedIn with the key words, which the recruiters may be looking for. The potential recruiters may screen the key words and short list the candidate.

The KWS software would be executed on a large number o CVs received and screen them to short list the candidates for further selection process which may include online tests and online interviews.

This technique of screening is really quick as the applicants who did not use the key words in their CVs would be weeded or sorted out quickly. However, there are certain drawbacks in this technique - some the qualified applicants may use some other words rather than the actual key words, and therefore they may be rejected.

3. Online Testing:

Under online testing, applicants can access test questions on a web site, answer and summit their responses to the prospective employers.

Various tests can be conducted online depending on the type of the job. The various tests may include:

The online test is quick as large number of candidates can long in at the same time to answer the test. Also, the results can be processed quickly with the help of computerized assessment. However, the online assessment is criticized as the candidates may adopt malpractices. For instance, a proxy candidate may get appear for the online test or the actual candidate may get assistance for responses from another person sitting close by (not facing the camera of the computer).

Online Interviews: Communication technology enables live interactions between

the candidate(s) and the interviewer(s). The candidates can answer various types of online tests, which may include:

The technologies used to conduct applicants interviews online are video-conferencing technology (such as Skype Video Call, WhatsApp Video Calling, etc.), which allow for video and audio streaming between different locations across the globe.

5. Online Reference Check:

The candidate provides references (name, address, contact number, e-mail address of two or three persons holding good positions in the society and known to the candidate) in their application so that the recruiter can check candidate s bona fides or credentials.

The potential employer may check online or through telephone with the references about the character, experience, qualifications or any other information known to them about the potential candidates. If the references give response in favour of the candidate, the potential employer may select the candidate for employment.

6. Final Online Interview:

The employer may conduct a final online interview before the job offer. This interview may be conducted by a panel of experts or executives of the company. In the final online interview, the terms and conditions of job offer are discussed and finalized. In India, a good number of firms would prefer a combo final interview before the final job offer. The combo final interview is a combination of online interview and face-to-face interview. The face-to-face interview is specially desired when the candidate has limited or no job experience.

In the face-to-face interview, the interviewers can judge properly the body language of the candidate and also there is a personal touch to the interview.

Advantages of e-Selection